Second opinion on medical bills
Diagnosis: As insurers shift responsibility for medical spending to patients, consumers are being overwhelmed by bills and choices. Prescription: New software and services to help patients track and manage their medical costs.
By Jeanette Borzo, Business 2.0 Magazine

(Business 2.0 Magazine) -- When tech entrepreneur Todd Lash's son, Simon, was born seven years ago with developmental problems, he and his wife, Tracy Joe, faced a barrage of never-ending medical bills.

The California couple couldn't find any software to help manage the mess, so last year Lash launched SimoHealth - named for Simon, now a happy first-grader - a PC application that organizes health-care expenses and uncovers discrepancies among medical bills, health-care payments, and insurance reimbursements.

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Ready for Takeoff: Todd Lash's SimoHealth will be part of Revolution Health's new consumer portal.
Health 2.0

His timing was perfect: AOL co-founder Steve Case's Revolution Health Group scooped up Simo Software a few months later for an undisclosed amount, adding Lash's startup to its portfolio of consumer-oriented medical services companies. The market for medical-expense software is not expected to exceed a modest $15 million to $30 million annually, but the real attraction for Revolution was the chance to incorporate SimoHealth into a forthcoming health portal.

"As consumers become more responsible for their health-care management and more fiscally responsible for their treatment," Lash predicts, "these tools will become ubiquitous."

That's certainly the trend: In just the past year, the number of people switching to high-deductible insurance plans and paying for medical care through health savings accounts tripled to 3 million.

By 2010 these so-called consumer-directed health plans are expected to account for a quarter of the market. That's creating a huge opportunity to help consumers track, invest, and spend the $75 billion they'll sock away in health savings accounts. Meanwhile, insurers' byzantine ways are spurring demand for software from new makers like SimoHealth and established ones like Intuit. As many as nine out of 10 medical bills contain errors, according to Medical Billing Advocates of America.

SimoHealth monitors how much money remains in your health savings account and will issue an alert when you've met your deductible for the year, green-lighting elective surgery. Best of all, it's always on duty, never plays golf, and works on Wednesdays.

To read more about the future of health care, click on the links below:

  • The Gene Screen Online genetic-testing services are springing up to take advantage of advances in genomics - and the growing willingness of consumers to conduct their most personal business over the Internet.
  • Retail Therapy More people are adding health care to their shopping lists as walk-in medical clinics are popping up in Wal-Marts, drugstores, and other retail outlets.
  • Home is Where the Health Care Is The market for home medical monitoring for chronic conditions is taking off thanks to new interactive devices that remotely track patients at home.
  • Steps to a Healthy Medical Startup We've identified ways savvy entrepreneurs like you can profit from Health 2.0. A hint? If you lack in-depth knowledge of the health care industry, don't be afraid to partner with someone who's got what you need. That's what AOL founder Steve Case did.
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Market indexes are shown in real time, except for the DJIA, which is delayed by two minutes. All times are ET. Disclaimer Morningstar: © 2014 Morningstar, Inc. All Rights Reserved. Disclaimer The Dow Jones IndexesSM are proprietary to and distributed by Dow Jones & Company, Inc. and have been licensed for use. All content of the Dow Jones IndexesSM © 2014 is proprietary to Dow Jones & Company, Inc. Chicago Mercantile Association. The market data is the property of Chicago Mercantile Exchange Inc. and its licensors. All rights reserved. FactSet Research Systems Inc. 2014. All rights reserved. Most stock quote data provided by BATS.